Types of builders and which type is best for you.
January 25th, 2018
Types of builders and which type is best
for you.
for you.
January 25, 2018
Typically, new home builders are grouped into three or four categories. The first of these are production builders.
Production builders typically are large companies which
build the same plans in multiple neighborhoods usually in several states or
regions. Since their plans are reused
over and over again they have taken numerous steps to value engineer the plan
to increase their affordability while keeping important items to appeal to
numerous people. Production builders
typically will limit both the quantity of changes to the plans and the
availably selections. By limiting these
items they further reduce overhead costs by not having to have staff available
to make the changes or research the requested product. While customizing a house based on buyer’s
wishes is not their forte, they do offer great value in what they do. By working on a large scale with more limited
products they can economize the house and its selections to make them more
affordable. In Collier and Lee Counties
these type homes are usually found in developments where the whole project is
run by the builder.
build the same plans in multiple neighborhoods usually in several states or
regions. Since their plans are reused
over and over again they have taken numerous steps to value engineer the plan
to increase their affordability while keeping important items to appeal to
numerous people. Production builders
typically will limit both the quantity of changes to the plans and the
availably selections. By limiting these
items they further reduce overhead costs by not having to have staff available
to make the changes or research the requested product. While customizing a house based on buyer’s
wishes is not their forte, they do offer great value in what they do. By working on a large scale with more limited
products they can economize the house and its selections to make them more
affordable. In Collier and Lee Counties
these type homes are usually found in developments where the whole project is
run by the builder.
Semi-Custom builders make up the next group. These builders are typically much smaller
than the production builders and the level of customization will vary
dramatically between the builders. In
Collier and Lee Counties, these builders will usually have several model homes
and other plans that they work from.
Depending on the builders level of customization they will make small
alterations to the model plans or in some cases make major changes. The available product choices also typically
increase with these builders. From a home
design stand point, these homes will be less value engineered than the
production homes and the available level of finishes will increase these homes
costs well beyond production housing. Arthur
Rutenberg has taken this concept into more expensive neighborhoods. They will offer product selections from a
company owned design studio and also make minor revisions to plans the
corporate office has developed. These
concepts help them control costs associated with more custom houses.
than the production builders and the level of customization will vary
dramatically between the builders. In
Collier and Lee Counties, these builders will usually have several model homes
and other plans that they work from.
Depending on the builders level of customization they will make small
alterations to the model plans or in some cases make major changes. The available product choices also typically
increase with these builders. From a home
design stand point, these homes will be less value engineered than the
production homes and the available level of finishes will increase these homes
costs well beyond production housing. Arthur
Rutenberg has taken this concept into more expensive neighborhoods. They will offer product selections from a
company owned design studio and also make minor revisions to plans the
corporate office has developed. These
concepts help them control costs associated with more custom houses.
Custom houses make up the next type of housing. Typically these homes involve an architect or
Residential Design firm to create a home for a home buyer. These homes can start from a concept the home
buyer has seen elsewhere, pictures of concepts from Houzz or Pinterest, just
thoughts the home buyer has. The
Architect or Residential Design firm then takes these concepts and creates a
custom plan. In some cases the home
owner will pay the architect to develop specifications to be used in the
construction process, in others the home owner will hire an interior decorator
to develop these specifications.
However, often the home owner relies on the builder to develop these
specifications. Since a true custom home
has not been built before it requires a bidding process to determine its final
price. Since the price is not determined
while the plans are being developed there is the very real chance that the home
as designed well exceeds the budget the home owner has in mind. Since the plan is a custom plan developed
solely for the home owner, the Architect or Residential Designer is fully paid
when the plans are completed. Custom
Builders should be the most experienced of the first three types of
builders. Since each plan is unique in
some way, the builder must be able to understand plans, diagnose potential plan
problems or errors, be able to develop a set of specifications unique to each
home, be able to comfortably handle the potential unforeseen plan or design
errors which can occur in custom plans, and be able to guide the home buyer
through the process in a coordinate manner to eliminate delays and owner
frustrations as much as is possible.
Residential Design firm to create a home for a home buyer. These homes can start from a concept the home
buyer has seen elsewhere, pictures of concepts from Houzz or Pinterest, just
thoughts the home buyer has. The
Architect or Residential Design firm then takes these concepts and creates a
custom plan. In some cases the home
owner will pay the architect to develop specifications to be used in the
construction process, in others the home owner will hire an interior decorator
to develop these specifications.
However, often the home owner relies on the builder to develop these
specifications. Since a true custom home
has not been built before it requires a bidding process to determine its final
price. Since the price is not determined
while the plans are being developed there is the very real chance that the home
as designed well exceeds the budget the home owner has in mind. Since the plan is a custom plan developed
solely for the home owner, the Architect or Residential Designer is fully paid
when the plans are completed. Custom
Builders should be the most experienced of the first three types of
builders. Since each plan is unique in
some way, the builder must be able to understand plans, diagnose potential plan
problems or errors, be able to develop a set of specifications unique to each
home, be able to comfortably handle the potential unforeseen plan or design
errors which can occur in custom plans, and be able to guide the home buyer
through the process in a coordinate manner to eliminate delays and owner
frustrations as much as is possible.
The final type of builder is a Design Builder. In addition to being a custom builder, this
type of builder also designs the homes as well.
The advantages to a good Design Builder are several. Since the builder is also familiar with
costs, there is less chance of the project being well over a discussed price
range. This can save not only a lot of
time, but also a lot of expense for the architect’s fee as well. Each Design Builder will have slightly
varying design agreements. Some will
have a certain cost they charge for the process while others will do the design
work free of charge. Divco Custom Homes falls into the Design
Builder type of builder. In our case
we have a simple design agreement that details what we design and the quantity
of changes that we will make prior to determining the project is feasible for
the home buyer. Up to the feasibility
check there is no cost to the home buyer.
Once the home buyer has determined the project is financially feasible
and if they want to continue to make changes, we have a hourly fee for these
changes. Some unusual projects may
require engineering to be done prior to a final price being issued. In our case, we work with these projects in
two ways. The first is to establish
allowances for the structural components that will change based on the
engineering. The second involves collecting
a deposit for the cost of the engineering, having it completed, and then
finalizing the agreement price when the engineering has been fully priced.
type of builder also designs the homes as well.
The advantages to a good Design Builder are several. Since the builder is also familiar with
costs, there is less chance of the project being well over a discussed price
range. This can save not only a lot of
time, but also a lot of expense for the architect’s fee as well. Each Design Builder will have slightly
varying design agreements. Some will
have a certain cost they charge for the process while others will do the design
work free of charge. Divco Custom Homes falls into the Design
Builder type of builder. In our case
we have a simple design agreement that details what we design and the quantity
of changes that we will make prior to determining the project is feasible for
the home buyer. Up to the feasibility
check there is no cost to the home buyer.
Once the home buyer has determined the project is financially feasible
and if they want to continue to make changes, we have a hourly fee for these
changes. Some unusual projects may
require engineering to be done prior to a final price being issued. In our case, we work with these projects in
two ways. The first is to establish
allowances for the structural components that will change based on the
engineering. The second involves collecting
a deposit for the cost of the engineering, having it completed, and then
finalizing the agreement price when the engineering has been fully priced.
Design Builders typically are also fully capable of building
Semi-Custom houses as well. We look
forward to discussing your project with you.
Semi-Custom houses as well. We look
forward to discussing your project with you.
Written By,
Stephen Kauffman, CEO at DIVCO Custom Homes